Tradeweb Markets reported a trading volume of $41.7 trillion in May 2024, marking a 40% year-over-year increase in average daily volume (ADV) to $1.9 trillion.
This growth underscored heightened activity across various segments in the electronic marketplace.
The ADV for US government bonds surged by 33.4% year-over-year to $192.5 billion, supported by broad client sector growth and favorable market conditions.
European government bond ADV saw a slight dip of 0.4% year-over-year to $41.4 billion.
However, the adoption of new protocols and increased primary issuance in Europe and the UK helped sustain trading volumes.
Mortgage ADV increased by 18.4% year-over-year to $197.1 billion, driven by heightened activity in dollar rolls, coupon swaps, and basis trading.
Tradeweb experienced the second-highest total volume ever for specified pool trading.
Swaps and swaptions with maturities of one year or more saw a 53.3% year-over-year increase in ADV to $484.2 billion.
Overall rates derivatives ADV rose by 67.9% year-over-year to $784.6 billion, reportedly boosted by strong institutional activity and a 69% increase in compression activity.
Fully electronic US credit ADV grew by 46.7% year-over-year to $6.6 billion, while European credit ADV increased by 16.1% year-over-year to $2.2 billion.
The US credit market posted notable growth in RFQ, portfolio trading, and Tradeweb AllTrade usage.
Municipal bonds ADV increased by 11.1% year-over-year to $357 million, aligning with broader market trends as institutional activity outpaced retail activity.
Credit derivatives ADV rose by 5.7% year-over-year to $8.7 billion, driven by heightened credit volatility and increased activity in swap execution facilities.
US and European ETF trading volumes declined, with US ETF ADV dropping 15.3% year-over-year to $6.1 billion and European ETF ADV decreasing 1.4% year-over-year to $2.3 billion.
This reduction was primarily due to lower secondary market volumes and decreased equity volatility.
Conversely, repurchase agreement ADV saw a 28.7% year-over-year increase to $605.1 billion, fueled by heightened client activity on Tradeweb’s electronic repo platform.
The market shift towards money markets was influenced by quantitative tightening, increased collateral supply, and adjustments in Federal Reserve policy.
Recently, Tradeweb introduced a new feature connecting its repurchase agreement and interest rate swaps to enhance execution workflow in these markets.
The electronic marketplaces aim to boost efficiency in how institutional clients navigate these markets through the new offering.
This integration aims to respond to heightened volatility in money markets caused by shifting expectations surrounding central bank policies.
The platform has integrated overnight index swap curves into the repo trade negotiation process to provide institutional clients with insights into pricing to address this challenge.